PHINIA Inc.

ladies and gentlemen thank you for standing by my name is krista and i will be your conference operator today at this time i would like to welcome everyone to the finia first quarter 2025 earnings conference call all lines have been placed on mute to prevent any background noise after the speaker's remarks will be a question and answer session if you would like to ask a question during this time simply press star followed by the number one on your telephone keypad And if you'd like to withdraw that question, again, press star 1. And I would now like to turn the conference over to Kellen Ferris, Vice President of Investor Relations. Kellen, you may begin.

Thank you, and good morning, everyone. We appreciate you joining us. Our conference call materials were released this morning and are available on FINIA's Investor Relations website, including a slide deck that we'll be referencing in our remarks. We are also broadcasting this call via webcast. Joining us today are Brady Erickson, CEO, and Chris Groff, CFO. During this call, we will make forward-looking statements which are based on management's current expectations and are subject to risks and uncertainties. Actual results may differ materially from these statements due to a variety of factors, including those described in our SEC filings. We caution listeners not to place any undue reliance upon any such forward-looking statements. And with that, it's my pleasure to turn the call over to Brady.

Thank you, Kellen, and thank you, everyone, for joining us this morning. I'll start with some overall comments on the first quarter and then provide some thoughts on 2025 and beyond. Chris will then provide additional detail on our financials and discuss our 2025 guidance. We will then open the call for questions. Starting on slide four of the deck, the first quarter developed largely as we expected with highlights including strong business retention, and new conquest wins, delivering on our capital return strategy, and maintaining a healthy balance sheet. During the first quarter, the macroeconomic environment and the automotive industry continued to show signs of slowing, similar to what we experienced in the second half of 2024. Our financial results reflect a soft top line, but with good segment-adjusted operating margin performance. While the environment continues to evolve rapidly, our teams are managing our priorities and our business well. Both aftermarket segment sales and fuel system segment sales were lower year over year, primarily due to lower OEM volumes. As a result, net sales in the quarter were $796 million, down 7.8% in the same period of the prior year, which included contract manufacturing revenues. Excluding the FX impact and CMA agreements that were in place last year, revenue decreased 4.1%. This was in line with our expectations as we see a softer first half of 25 on a global basis. We reported adjusted EBITDA of 103 million with a margin of 12.9%, a 260 basis point year-over-year decline. The decrease was primarily due to lower sales, added infrastructure costs to support the business as a standalone entity, and the strong Q1 2024 comparison. Total segment adjusted operating margins were 12.2%, 140 basis point decrease when compared with the first quarter of 2024. Adjusted earnings per diluted share, excluding non-operating items as detailed in the appendix, was 94 cents. Our team continued to work closely with suppliers and customers in order to efficiently and effectively work through dynamic business conditions. On the capital side, we continue to take steps intended to drive long term value for our shareholders. Our balance sheet remains strong with cash and cash equivalents of 373 million, and combined with our undrawn revolver, our total liquidity is approximately 900 million. Importantly, Our net leverage ratio was 1.4 times, closing in on our approximate target of 1.5 times. And lastly, our solid financial position enabled us to return $111 million to shareholders via share buybacks and dividends during the first quarter of 2025. In fact, we bought back more than 7.5 million shares, or roughly 16.5% of outstanding shares, since we were spun out in July of 2023. Let us now move to slides five and six for discussion of new business wins. We saw sustained momentum in new customer growth and continue to generate growth opportunities in our core business. Additionally, I'm pleased with our efforts around new product development and new customer wins. Our continued focus on deepening our relationship with customers, the expansion of our product offering, and our ability to capture new business wins give us many levers to drive the business. Let me call out a few. a 350-bar gasoline direct injection system, or GDI, for an alternative fuel application, which is using E100. It's with a leading international automobile manufacturer for the Brazilian market, which leverages existing high-performance Finia GDI technology while adapting it for decreased carbon emission alternative fuels. Two high-volume fuel delivery module, or FDM, wins in the Americas market for a gas truck platform that continues to expand the use of thinning's robust and versatile FDM technology. A conquest selective catalyst reduction, or SCR, pump win for the Chinese market securing additional LPV and LCV revenue in China focused on lowering tailpipe emissions. Aftermarket business wins in the steering and suspension category with a member of a major customer group in Scandinavia and a major Canadian distributor, which will boost our business in Canada and provides opportunities to expand sales and other product categories over time. Business expansion with a major U.S. distributor, which is a consolidator in the warehouse distribution space, further strengthening our relationship. Increased share of wallet with a major U.S. distributor across all product categories. growing with them as they expand their business. We are committed to driving expansion and complementary product categories and executing on a creative M&A to drive additional scale in our business. Additionally, we continue to believe that the breadth and scale of our customer base provides a strong foundation for continued growth. Now moving on to slide seven, capital allocation. Our capital priority is, first and foremost, to invest in our business for long-term profitable growth. We return excess capital to shareholders through both dividends and share repurchases. We have a proven track record of being financially disciplined and focused on maximizing long-term shareholder value. We have $264 million remaining under our current repurchase authorization, and we expect to continue to opportunistically repurchase shares as part of our capital allocation strategy. FINIA continues to demonstrate financial stability and consistency. and I'm confident in our ability to respond to this challenging macroeconomic environment. Looking ahead and summing up, we have much to be excited about in 2025 despite the dynamic North American market. The global nature of our business, the diversity of the markets we serve, and our substantial aftermarket business will benefit us greatly. We continue to launch new innovative products around the world and look forward to moving from stabilizing the business post-spinoff to building on and further improving the foundation we have built. Regarding the evolving North American market, I wanted to help frame the impact of tariffs on our business. A majority of our North American manufacturing capacity has been in Mexico for more than 30 years and represents roughly $1 billion of our revenues, or less than 30% of our global revenues. The majority of our products are USMCA compliant, and roughly half is sold to customers in Mexico. We are also working closely with our customers and suppliers on a number of options to adjust sourcing, sales, and logistics flow to mitigate at least some of the impacts of tariffs on products not qualified under USMCA. While we continue to digest the new trade policies and qualified mitigation plans, we feel we have several options and pathways to respond to this dynamic environment. We also believe the diversity of our global business and of our customers has us well positioned to manage the impact of tariffs on our business. I'd like to conclude with a few important messages. First, we are navigating near-term uncertainty well and appreciate the commitment of our strong global team. Second, we are very confident in the strength, the resilience, and the overall health of our company, which will allow us to continue to invest in our business, make acquisitions, and return capital to shareholders. And third, Our long-term strategy to grow our CV, industrial, and aerospace OE business and aftermarket and service offerings remains intact, and we believe it will allow us to deliver long-term shareholder value. With that, I'll hand it over to Chris, who will walk us through our Q1 results and discuss our outlook for the year. Chris?